Yesterday after market hours, Asian Paints announced that the that Competition Commission of India, (CCI) has passed a prima facie order dated 14th January, 2020, directing the Director General to cause an investigation against the Company, on the basis of information received from JSW Paints.
The CCI website stated that JSW Paints alleged that Asian Paints threatened various dealers in Karnataka, Telangana and Tamil Nadu from dealing with JSW. It is using its dominance in the market to disrupt JSW’s entry into the paints segment.
CCI said, “ In the facts of the present case, the commission notes that the alleged conduct of Asian Paints of threatening and pressurising dealers as highlighted by JSW Paints prima facie brings out that Asian Paints has attempted to prevent JSW Paints in establishing a presence in the relevant market."
Today morning, the market reacted negatively to this news. The stock price, which had hit a new 52-week high yesterday at Rs.1841.75, opened lower at Rs.1838.20, going down to an intraday low at Rs.1829.75. It has recouped from there but remains in the red.